BOISE - Idaho is now poised for another $69 million in budget cuts this year, after the Legislature’s joint budget committee voted along party lines this morning to set budget targets that assume state revenues will continue to lag well beyond what state economists project.
“It’s only realistic and it’s only prudent,” said Rep. George Eskridge, R-Dover. “The word I get from my constituents is, ‘George, do the right thing, and that means no tax increase. … We can’t afford it.”
Sen. Shawn Keough, R-Sandpoint, urged Idahoans who are still doing well to donate to their local food banks, homeless shelters and other entities that help the needy. “Our government is funded by the Idaho taxpayers, and we can’t extract from them what they do not have,” she said.
Minority Democrats on the committee argued for higher numbers to avoid such drastic budget cuts and stick with state economists’ forecasts, but were outvoted along party lines.
“We all know what’s needed to move Idaho’s economy ahead - jobs and consumer confidence, and our actions today will set the tone,” declared Rep. Shirley Ringo, D-Moscow. She and other Democrats argued that steeper budget cuts will mean more lost jobs for the state and more harm to the economy; she submitted a “contingency plan” to the joint committee calling for raising additional revenue by hiring more tax auditors to collect uncollected taxes, tapping reserves and more, should tax revenues fall short.
But Sen. Dean Mortimer, R-Idaho Falls, said, “We are in tough times. … I think it’s going to take every bit of our savings as well as maybe more to get us out of fiscal year 2010, and I hope … that that is not the case, but I believe that it is the case.”
The Joint Finance-Appropriations Committee voted to stick with figures recommended by the Legislature’s Joint Economic Outlook and Revenue Assessment Committee, which earlier voted to set expected state tax revenues for this year at just $2.28 billion, and for next year at $2.29 billion. That’s $69 million below the governor’s proposed budget for this year, and $59 million below the proposed budget he submitted to lawmakers for next year, fiscal year 2011.
Wayne Hammon, Gov. Butch Otter’s budget chief, said Otter is supportive of the move. “We don’t plan to submit a formal revision, but the governor’s office will work with JFAC members as they work to set the budget to this new, lower number,” Hammon said. “I am confident that he will be pleased and supportive of it.” He added, “The number that we based our budget on is now three months old, and unfortunately tax receipts have not kept in line with his forecast.”
Asked how this year’s budget could be cut another $69 million, Hammon said, “There are places to do it. The big fear is that we’re way past cutting fat.” These cuts, he said, citizens will feel. “They are serious decisions at this point. … The governor’s already notified agencies to be prepared for that.”
The decision came despite news this week that the governor’s chief economist, Mike Ferguson, has determined there’s no reason to revise his latest revenue forecast. Otter’s proposed budget for next year already was set $83 million below Ferguson’s forecast, just to be on the safe side.
It’ll now be up to JFAC to make the cuts. Keough said she and other JFAC members are working to find a way to protect public schools from any cuts during the current year, though they’d then be hit with cuts next year. Keough said she believes it’s possible, but it would mean deep cuts in other areas this year.
Said Senate Finance Chairman Dean Cameron, R-Rupert, “It’s going to be a very, very difficult budget.”
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